Makalot posts double-digit growth

By Camaron Kao  /  Staff reporter

Thu, Mar 07, 2013 - Page 14

Makalot Industrial Co (聚陽實業), a supplier for global fashion brands, such as H&M and Zara, reported double-digit growth in year-on-year revenue last month, remaining unaffected by the Lunar New Year holiday as clients increased orders on a better outlook for demand.

The company’s consolidated revenue increased 28.26 percent from a year ago to NT$1.37 billion (US$461.76 million) last month, according to its filing to the Taiwan Stock Exchange on Tuesday.

The figure was down 9 percent from a month earlier, it said.

Makalot public relations manager Mavis Chiu (邱美惠) said sales were not affected by the Lunar New Year holiday, when most companies saw fewer working days and lower shipments abroad, because about 85 percent of the company’s clients are based in the US.

“We benefited from the brighter economic outlook in the US, where our clients maintained their orders with us during the Lunar New Year holiday,” Chiu said by telephone yesterday.

While the company’s factories in China and Vietnam were closed during the holiday, its factories in Cambodia and Indonesia operated as usual, Chiu said.

Makalot’s customer base is largely department stores and includes Kohl’s Corp and JC Penney Co, mass retailers like Target Corp and Wal-Mart Stores Inc, and specialty apparel stores, such as Hanesbrands and Carter’s.

Chiu said the company’s prospects were bright this year because it has adopted a strategy to increase its sales exposures in Taiwan, Europe and Japan.

There is also a trend of major clothing retailers making orders to fewer suppliers on cost concerns. Chiu said Makalot would continue to be one of the few suppliers of its clients and would receive orders of larger quantities than before.

“This will benefit the company throughout this year,” she added.

Production volume is expected to increase this year and the larger the quantity of Makalot’s production, the lower average costs Makalot will bear, Chiu said.

Makalot is building a new factory in Indonesia, where the company can make goods at lower cost. The factory is expected to open by the third quarter this year, she said.

On Tuesday, the company also began sales of its own brand of clothing, “Fisso,” as it aims to boost revenue and compete with casual-wear retailers like Japan’s Uniqlo Co and Taiwan’s Lativ Co (米格國際).

Targeting young consumers aged 16 to 35, Fisso will focus on casual and comfortable clothes that are affordable, such as summer T-shirts that sell for between NT$300 and NT$500.

However, Chiu declined to comment on Fisso sales, saying that it was too early to tell how the new brand would perform.

Makalot’s shares grew 0.5 percent to NT$101 yesterday, outperforming the TAIEX, which was up 0.22 percent. In the past 12 months, the shares have gained 27.85 percent, while the TAIEX was up 0.16 percent.